Which One of the Following Subsequent Events Will Least Likely

question 128

Multiple Choice

Which one of the following subsequent events will least likely result in an adjustment to the financial statements?

• A)Material change in the amount of settlement of a lawsuit which had been estimated at year end.
• B)Bankruptcy of a customer who owes your client a material amount on open account at year end for which there is an inadequate allowance estimate.
• C)Sale of a large block of inventory at a price materially below carrying value.
• D)Signing of a letter-of-intent by the client to acquire 55% of another entity for stock.

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Definitions:

Depreciating

A decrease in the value of an asset over time, often due to wear and tear or changes in market conditions.

Exports

Goods or services sent from one country to another for sale or trade.

Imports

The act of bringing goods or services into a country from abroad for sale.

Fiscal Policy

A government's strategy in managing its taxes and spending to influence the nation's economy.